This module allows you to analyze existing cross correlation between Greece TR and IPC. You can compare the effects of market volatilities on Greece TR and IPC and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Greece TR with a short position of IPC. See also your portfolio center. Please also check ongoing floating volatility patterns of Greece TR and IPC.

Pair Volatility

Assuming 30 trading days horizon, Greece TR is expected to under-perform the IPC. In addition to that, Greece TR is 1.91 times more volatile than IPC. It trades about -0.28 of its total potential returns per unit of risk. IPC is currently generating about -0.25 per unit of volatility. If you would invest 4,892,848 in IPC on February 17, 2018 and sell it today you would lose (179,037) from holding IPC or give up 3.66% of portfolio value over 30 days.

Correlation Coefficient

Pair Corralation between Greece TR and IPC

0.8

Parameters

Diversification

Very poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding Greece TR and IPC in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on IPC and Greece TR is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Greece TR are associated (or correlated) with IPC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IPC has no effect on the direction of Greece TR i.e. Greece TR and IPC go up and down completely randomly.